Ethiopian Airlines plans Beijing as East Asian hub

Ethiopian Airlines stated Beijing is scheduled to become the East Asian hub for the carrier, as it takes advantage of fast development in trade between China and Africa (Nazret, 19-Aug-2010). The carrier commented that, in the peak season, load factors often exceed 90% on Africa-China services. The carrier added that it hopes to launch services to Shanghai or Hangzhou in the near future, in addition to its existing Addis Ababa-Beijing service.

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Air Mauritius has returned to profitability and is keen to pursue expansion in support of an ambitious hub strategy by its government shareholder. The airline turned an EUR18 million operating profit in the year ending Mar-2016 as passenger numbers grew by 9.4% - representing the fastest growth in five years.

Mauritius is geographically well positioned to attract sixth freedom traffic between Africa and Asia, a fast-growing market. However, competition is intensifying in the Africa-Asia market and in Mauritius, which could make it difficult for Air Mauritius to succeed at developing a new east-west hub while maintaining its new-found profitability.

This is the second part of an analysis report on Air Mauritius and the Mauritius market. The first report looked at Air Mauritius' expansion in Asia, and the need to bolster its network in continental Africa in order to secure more sixth freedom traffic between Asia and Africa. It also examined the impact of AirAsia X’s Oct-2016 launch of services to Mauritius. In this half of the report CAPA will look in more detail at the intensifying competition in the Mauritius market; how this may impact Air Mauritius’ new-found profitability and its ability to further develop an Africa-Asia hub.

Mauritius is pursuing an ambitious hub development strategy aimed at positioning the small Indian Ocean country for transit traffic in the fast-growing Africa-Asia market. The government is investing in expansion and fleet renewal at Air Mauritius while also promoting the hub to other airlines.

Following the 12-Jul-2016 launch of Guangzhou services Air Mauritius has overtaken Ethiopian as the African airline with the largest Asia Pacific network. Air Mauritius is keen to continue expanding its operation in Asia and in parallel to develop its now limited African regional network to support Mauritius’ hub aspirations.

AirAsia X plans to launch services to Mauritius in Oct-2016, becoming the only Asian airline in the Mauritius market. Competition has already intensified in the market with the launch of services from Turkish Airlines, and Emirates' starting to deploy its high density 615-seat A380. The intensifying competition could threaten Air Mauritius' newfound profitability but the airline is also eager to forge new partnerships.